A guide to third sector trading - WCVA

It’s an idea, but is it business? A guide to third sector trading
1: Getting
started
2: First steps 3: Business
planning
4: Legal and
governance
5: Funding
and
resourcing
6: Financial
controls
7: Managing
growth
8: Management
and
governance
9: Social
enterprise
10: Sources
of support
Planning for future growth
Wider funding options: Don’t let your horizons be restricted
by the grant dependent thinking of so many third sector
organisations. While newly established organisations are unlikely
to have the confidence or credibility to go for loans, existing
charities and groups which are planning to trade can consider
wider funding options. The following list gives a flavour of the
wider possibilities. Some are considered separately in sections 5.3
and 5.4, and Chapter 7 considers the possibilities for growth in
established trading organisations.
• grants without strings
• earned income and funding from profits
• contracts with capital funding
• grants linked to loans
Towards a strategy for funding and resources: The business
plan should be clear about your approach towards resourcing
your business activities. Potential supporters will expect it, and
your own directors and staff will need it to guide their decisions.
The issues the plan should cover include:
• a statement of where your trading activity stands and where it is
heading (ideally with targets) on the huge continuum between
grant dependency and total financial independence
• the extent to which earned income (from whatever sources) will
contribute to the organisation
• the purpose and nature of additional funding (grants or loans or
both) if you need it.
You will need to decide what you want to aspire to and what in
the short to medium term is actually achievable.
• unsecured loans
• mortgages and secured loans
• bonds and shares
• voluntary effort.
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